Starbucks to launch cheaper coffee brand in UK as sales decline

US coffee giant Starbucks is bringing its cheaper coffee brand to the UK to compete with rivals such as McDonalds as it faces flagging sales.

Starbucks bought Seattle’s Best Coffee in 2003 and has been expanding it in the US where it has around 40 cafes and sells it across 50,000 locations. It has now agreed a deal with retailers Asda, KFC and Kiddicare to sell Seattle’s Best Coffee espresso drinks and filtered coffee in their cafés here.

Last month Starbucks revealed its first UK sales fall since it opened in 1998. It reported sales fell from £413 million to £399 million in the year to September 29.

When Starbucks launched Seattle’s Best Coffee in the US analysts said it was an answer to competition from fast food outlets selling cheaper coffee.

Simon Hillier, Starbucks European foodservice director, said: “We chose to launch Seattle’s Best Coffee in the UK because we know Brits love their coffee.” He said Seattle’s Best Coffee offers an “everyday range” of coffees for “coffee on–the-go customers”.

Starbucks has been looking at a range of new initiatives and recently launched a tea bar in New York called Teavana Tea Bar.

Starbucks had around 550 outlets in the UK and has been closing some of its loss making stores that had expensive rents.

So far it has no plans to open Seattle’s Best Coffee cafés in the UK and will focus on supplying other retailers’ cafes.

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